Raymond James analyst Jayson Bedford has revised the price target for AxoGen (AXGN, Financial), decreasing it from $25 to $21, although he maintains an Outperform rating following the company's first-quarter report. Despite a weaker gross margin in Q1 introducing some uncertainty, Bedford believes the recent 15% decline in share value is an overreaction. The firm argues that AxoGen has the potential to achieve revenue growth in the mid- to high-teens range through a focused strategy, which could create a distinct growth trajectory within the small-cap Med Tech sector.
Raymond James perceives the current drop in share price as a potential buying opportunity, expressing confidence in the company’s management to resolve short-term margin issues.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 8 analysts, the average target price for Axogen Inc (AXGN, Financial) is $26.13 with a high estimate of $30.00 and a low estimate of $24.00. The average target implies an upside of 108.00% from the current price of $12.56. More detailed estimate data can be found on the Axogen Inc (AXGN) Forecast page.
Based on the consensus recommendation from 8 brokerage firms, Axogen Inc's (AXGN, Financial) average brokerage recommendation is currently 1.8, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Axogen Inc (AXGN, Financial) in one year is $13.89, suggesting a upside of 10.59% from the current price of $12.56. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Axogen Inc (AXGN) Summary page.
AXGN Key Business Developments
Release Date: February 25, 2025
- Full Year 2024 Revenue: USD 187.3 million, a 17.8% increase compared to 2023.
- Fourth Quarter 2024 Revenue: USD 49.4 million, up 15.1% compared to the prior year.
- Fourth Quarter Gross Profit: USD 37.6 million, with a gross margin of 76.1%.
- Total Operating Expenses for Q4 2024: USD 35.6 million.
- Marketing Expenses as a Percentage of Revenue: Decreased to 40.6% from 46.9% in Q4 2023.
- Research and Development Expenses for Q4 2024: USD 6.7 million, a decrease of 6.2% from Q4 2023.
- General and Administrative Expenses for Q4 2024: USD 8.8 million, up 11.8% from Q4 2023.
- Net Income for Q4 2024: USD 0.4 million or USD 0.01 per share.
- Adjusted Net Income for Q4 2024: USD 3.5 million or USD 0.07 per share.
- Adjusted EBITDA for Q4 2024: USD 6.7 million.
- Cash, Cash Equivalents, and Investments as of December 31, 2024: USD 39.5 million.
- 2025 Revenue Growth Guidance: Expected to be in the range of 15% to 17%.
- 2025 Gross Margin Guidance: Expected to be in the range of 73% to 75%.
- Cash Flow Guidance for 2025: Expected to be net cash flow positive for the entire year.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Axogen Inc (AXGN, Financial) reported a 17.8% increase in full-year 2024 revenue, reaching USD187.3 million, indicating strong growth across all served markets.
- The company successfully submitted its Biologics License Application (BLA) for advanced nerve graft, expecting approval in September, which could provide 12 years of market exclusivity.
- Axogen Inc (AXGN) achieved a gross margin of 76.1% in Q4 2024, up from 74.6% in the same period last year, reflecting improved sales productivity and resource allocation.
- The company is targeting a compound annual growth rate (CAGR) of 15% to 20% over the next four years, driven by strategic investments in market development and innovation.
- Axogen Inc (AXGN) plans to double its sales force in the breast reconstruction segment, indicating confidence in expanding its market presence and driving adoption of its nerve repair algorithm.
Negative Points
- Despite revenue growth, Axogen Inc (AXGN) faces challenges in expanding commercial payer coverage policies, impacting growth in the extremities market.
- The company anticipates a one-time cost of approximately USD 2 million related to the BLA approval, which will impact the full-year gross margin by about 1%.
- Axogen Inc (AXGN) acknowledges the need for significant high-quality data to fully develop targeted opportunities, indicating ongoing investment requirements.
- The company faces challenges in market penetration and development, with many potential customers still unaware of Axogen Inc (AXGN)'s offerings.
- Axogen Inc (AXGN) expects a net cash outflow in Q1 2025 due to yearly bonus payments and the national sales meeting, highlighting seasonal cash flow fluctuations.
